IIARD International Institute of Academic Research and Development

IIARD INTERNATIONAL JOURNAL OF BANKING AND FINANCE RESEARCH (IJBFR )

E-ISSN 2695-1886
P-ISSN 2672-4979
VOL. 9 NO. 3 2023
DOI: https://doi.org/10.56201/ijssmr.v8.no1.2022.pg32.40

---

Fiscal Policy and Poverty levels: Empirical evidence from Nigeria

Benson Emmanuel, PhD, Ajam Peter Ngbede

---

Abstract

This study examines the determinants of poverty levels in the Nigerian economy from 1990 to 2021.This was aimed at ascertaining how aggregate government spending (GEXP), aggregate public debt (PUD) and tax revenue (TXR) has stimulated the poverty levels in Nigeria. Historical data was collated and estimated employing the ARDL form of Ordinary Least Squares (OLS) technique. The empirical results indicate that all selected fiscal policy variables were significant on poverty levels. While both aggregate public debt and tax revenue increased poverty levels, government spending exert significant negative impacts on the poverty levels in Nigeria. On the basis of the findings of this study, the following recommendations are made. Government should sustain and increase its current budgetary spending as they have been seen to reduce the incidence of poverty in the country. Since aggregate debt cause poverty in Nigeria, meaning that policy intervention should focus on the effective management of the borrowed funds in order to drive the process of economic development. Finally, tax revenue should be more of progressive in Nigeria. The current universal tax policy of government has been proven to cause poverty so there is need to reconsider it for more progressive based tax system

---

References:

Abubakar, A.B. (2016). Dynamic effects of fiscal policy on output and unemployment in
Nigeria: An econometric investigation. CBN Journal of Applied Statistics, 7(2),
101 – 122.

Afonso, A., & Alves, J. (2016). Reconsidering Wagner’s law: Evidence from the functions of the
government”,
working
papers,
available
at:
www.repository.utl.pt/bitstream/10400.5/11313/1/wp092016.pdf.

Badreldin, M.A.A. (2013). Fiscal policy and economic growth in Sudan, 1996-2011.
International Journal of Economics, Finance and Management, 2(8) 531 – 538.

Balogun, E. D. (1999). Analyzing poverty: Concepts and methods. Central Bank of Nigeria
Bullion 23(4), 11-16.

DOWNLOAD PDF

---

Back